The management of the Book Warehouse Company wishes to apply the Miller-Orr model to manage its cash investment. They have determined that the cost of either investing in or selling marketable securities is $100. By looking at Book Warehouse’s past cash needs, they have determined that the variance of daily cash flows is $20,000. Book Warehouse’s opportunity cost of cash, per day, is estimated to be 0.03%. Based on experience, management has determined that the cash balance should never fall below $10,000.  4. How much is the variance of daily cash flows?(Use a number, no decimal value, no commas, no currency, no space) * 5. How much is the lower limit based on the Miller-Orr model of cash management

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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The management of the Book Warehouse Company wishes to apply the Miller-Orr model to manage its cash investment. They have determined that the cost of either investing in or selling marketable securities is $100. By looking at Book Warehouse’s past cash needs, they have determined that the variance of daily cash flows is $20,000. Book Warehouse’s opportunity cost of cash, per day, is estimated to be 0.03%. Based on experience, management has determined that the cash balance should never fall below $10,000. 

4. How much is the variance of daily cash flows?(Use a number, no decimal value, no commas, no currency, no space) *


5. How much is the lower limit based on the Miller-Orr model of cash management? (Use a number, no decimal value, no commas, no currency, no space) *


6. How much is the opportunity cost of cash, per day? (Use a number, must be in decimal form. eg. 6.3%/100, encode 0.063 , no commas, no currency, no space) *

PLEASE ANSWER ALL QUESTIONS. THANKS!

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